Modi-Xi could discuss roadmap to address widening trade deficit
The volume of India’s bilateral trade with China grew by 13.19% to reach $ 95.54 billion.
The Prime Minister is expected to convey to Chinese President New Delhi’s concerns over widening trade deficit. The volume of India’s bilateral trade with China grew by 13.19% to reach $ 95.54 billion.
While the volume of the bilateral commerce increased, the trade deficit also widened from $ 51.72 billion in 2017 to $ 57.86 billion in 2018. The two leaders are likely to exchange views on the Regional Comprehensive Economic Partnership agreement.
Since Modi and Xi held the first “informal summit” at Wuhan in central China in April 2018, Beijing did take certain measures to allay New Delhi’s concerns and simplified its regulatory processes to allow more imports from India, particularly for certain agricultural products like soybean, rapeseed, non-basmati rice and sugar.
This has not yet translated into a significant rise in export of those products from India to China. Besides India is also seeking market access for other products including wider market access in China for India’s pharmaceutical products and IT services.
Chinese Ambassador to India Sun Weidong, said earlier this week that China encouraged its companies to invest in India and it would expect that India would provide them “a more fair, friendly and convenient business environment” for its companies. He told China Global Television Network that over 1,000 Chinese companies had invested about $ 8 billion in industrial parks, e-commerce and other sectors in India, creating 200,000 jobs. He also noted that China’s imports from India increased by 15% over the past five years. He also said that the potential for greater economic cooperation and trade between India and China was huge with the two nations being home to 2.7 billion people.
The comments by the Chinese envoy are significant in the backdrop of slowdown in Chinese economy and industrial production. Industrial growth touched 4.4 per cent in August from the same period a year earlier, the slowest since February 2002.
China's exports fell by 1 per cent in August and imports reduced by 5.6 per cent due to slow domestic demand and slump in the global manufacturing sector.